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turnover of £5.5 million, about half of which--£2.8

million--represents cargo handling activities. Yet other ports that do not have cargo-handling functions may not reach the £5 million threshold and will therefore escape the central direction of the Secretary of State for which the Bill allows. In terms of harbour activity, and the activities to which the Minister referred in Committee, however, such ports will not be caught, whereas Blyth, a substantial 50 per cent. of whose turnover is attributable to cargo handling, will be caught. There is an important distinction to be drawn.

That is yet another example of how different harbours and different harbour trusts may wish to apply different criteria and in the absence of an alternative criterion from the Government, it is not unreasonable that the harbour trusts should draw the attention of the House to particular factors affecting their operations.

I hope that the Minister will be persuaded by my arguments and that common sense will prevail. I hope that the hon. Gentleman will accept the amendments so reasonably suggested by my hon. Friends and me.

Mr. Malcolm Bruce (Gordon) : I support the amendment. Like other hon. Members who represent constituencies in the north of Scotland, I have received sustained representations about the Bill, particularly from representatives of Aberdeen harbour.

I am sorry to see that the Secretary of State has left his place. To some extent, he has spoken with forked tongue on the matter. On one hand, he says that the Bill is not directly targeted at ports such as Aberdeen and that the Government have bigger ports in mind, while on the other, it has been widely reported that the Conservatives propose to include in their Scottish manifesto a pledge to sell off local authority ports in the north of Scotland. In those circumstances, assurances to the effect that Aberdeen will not face compulsory privatisation ring somewhat hollow. If tiny fishing ports are to be sold off--one wonders who will buy them--it seems unlikely that, in the long run, the Government will hang back when it comes to Aberdeen.

Whatever happens, I have no qualms about the future of Aberdeen as a port, because it provides an essential service and operates in the interests of the local community. It is a matter of considerable concern to me that the Government seem to believe that commercial accountability is the only criterion by which ports should be judged. The ports provide an essential community service. The Minister will know that the dispute affecting the fishing harbour in Aberdeen was the trigger for the legislation under which the dock labour scheme was abolished and I supported--indeed, had called for--such legislation at the time, because I felt that the port of Aberdeen was being killed off.

I do not approach the matter in a dogmatic or purely ideological manner. I am merely interested to ensure that Aberdeen has a port that best serves the interests of the local community. The Secretary of State should not be able to determine on a whim--at the stroke of a pen, and for ideological reasons--that the ownership and management of a port should be fundamentally changed. That is not a satisfactory situation. There is no guarantee that the views of the trustees or representatives of the local community will be taken into account. Naturally, I support the amendment, because it removes such uncertainty from Aberdeen harbour authority.

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Mr. Loyden : Does the hon. Gentleman agree that one of the basic faults of the Bill is that it takes no account of the long-term location and activities of the ports and that it is based on current economic judgments which may change considerably in the years that lie ahead? No one can forecast with any certainty where trade will grow and where it will decline. Therefore, it is essential that there is a body that overlooks port location, so that such difficulties can be overcome.

Mr. Bruce : The hon. Gentleman has a point. I do not wish to detain the House, but I should stress that it is desirable to have ports with different structures of ownership and management--a diversity that creates genuine choice. I have no problem with that. However, I object to the idea that a port should be forced to change its status, not because it seems in the best interests of the long-term development of the port--that may be an appropriate decision for some local authorities--but because, for ideological reasons, the Secretary of State has decided that he does not like the way in which the port is being run, even though the port users and the local community are entirely satisfied.

Mr. Wallace : The Secretary of State appoints the members of the boards.

Mr. Bruce : As my hon. Friend the Member for Orkney and Shetland (Mr. Wallace) says, we are increasingly being run by boards appointed by the Secretary of State specifically to implement the wishes of the Secretary of State and the Government, who cannot get a political mandate in Scotland for the changes that they seek to bring about. One is left with an unanswered question. If the Scottish Conservatives put in their manifesto a pledge to privatise all local authority ports and, as I predict, lose every parliamentary seat in which the ports are situated, will they still regard that as a mandate and disregard the clearly expressed wishes of the local community? The answer is, of course, that they will. They are not interested in local democracy or local communities. The Government are being as dogmatic as they have accused the Labour Government of being in the past. They are trying to impose an idelogical decision on a body which is currently constituted to serve the interests of the local community. Unless the Government can justify that change of use and explain why they believe that it is necessary, the House should accept the amendment. Indeed, the main thrust of the Bill should not be there in the first place.

Mr. Robert Hughes (Aberdeen, North) : I do not wish to detain the House long. I do not disagree with much of what the hon. Member for Gordon (Mr. Bruce) said. However, I am unaware--I admit that I have been otherwise engaged for part of the debate this evening--of any promise by the Secretary of State not to use the powers in the Bill to compel Aberdeen harbour board to seek full commercial status in the market. If he has given such a promise, it is not worth anything.

In Committee I got into trouble for quoting American presidents and vice- presidents. It was once said about the vice-presidency of the United States that it was not worth a bucket of warm spit. Any promise from this Government has exactly the same credibility. The whole thing is nonsense. There is no point in taking a reserve power to

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compel a port to be privatised when it does not enter the private sector of its own volition, if one does not intend to use that power.

Without going into too much detail--given the time of the evening--the Secretary of State knows perfectly well that, apart from the local authority representatives, every member of Aberdeen harbour board is appointed by the Secretary of State for Scotland after discussion with the various user interests in the port of Aberdeen, such as the fishing industry, the oil industry, general commercial industry and general users of the port. They are all consulted and have representatives on the board nominated by the Secretary of State.

If the members of the board are unanimous about anything, it is that they do not wish the harbour to be privatised by the diktat of the Secretary of State. The members have said that they see no reason why the harbour should go into the private sector. It is doing extremely well. Its turnover is holding up. It has invested in the port out of its own revenues. Development plans for the next few years show that there is to be another £10 million of development at the port, all of which will be generated from its own income. People may sometimes say that the arrangement between the users of the port and the harbour board is too cosy and that the revenues are used for the benefit of the users of the port. Who else should have the benefit of the money that is coming in if not the people who use the port? They are saying that they are perfectly happy to pay such reasonable harbour dues as the board may decide, provided the decisions on how the money is spent are made locally.

I have had several representations from private companies, including one only a couple of days ago, about the fact that Aberdeen harbour board might be thrust, against its will, into the private sector. They view that prospect with abhorrence and have asked me to do what I can to ensure that the good arrangements which they have at Aberdeen are not disturbed. I understand that the Minister will not withdraw the reserve clause, and that he will not drive that coach and horses through his Bill. We should disturb the trust ports as little as possible.

10.30 pm

As the hon. Member for Gordon (Mr. Bruce) has said, the idea that the local authority ports may shortly be privatised has been widely floated. I shall not attempt to go through every port north and south of Aberdeen, but we know that Aberdeen is a trust port and would be caught as the Bill stands. Fraserburgh and Peterhead are both trust ports. As I recall, they are well below the current limit and are unlikely even through inflation or by changes in trade to come up to the limit. Further round the coast are Buckie and Lossiemouth, which I understand are local authority ports. It would be nonsense for the Government to privatise Aberdeen harbour board compulsorily because it is caught by the legislation, leave Fraserburgh and Peterhead out for the moment, and sell the local authority ports.

Mr. Wallace : The hon. Gentleman should not give them ideas.

Mr. Hughes : The idea is already there. We know what the hidden agenda is. The intention is to sell everything that moves and everything that does not move because they need the money for other nefarious purposes.

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Mr. Bell : I apologise for intervening in a fine speech so late in the evening, but the turnover at Peterhead is £1.5 million. We know that the Treasury is not interested in such a small sum.

Mr. Hughes : My hon. Friend is far too generous. We have to act on the supposition that the Government have a shelf life at least until June 1992. On that basis, as they scrabble around to try to get money to meet the magical figure of 20p in the pound for income tax or to find some way to bolster up the poll tax, which will still be in existence, and as they scrabble around for every financial inducement that they can use to buy votes, even a port with a turnover of £1.5 million will not escape the net, especially if they proceed to sell the local authority ports.

It does not make sense to have a patchwork of different activities along the same coastline. I know what the Government are up to. I join the hon. Members for Gordon and for Orkney and Shetland (Mr. Wallace) in an appeal for the limit to be raised. The higher it is, the better. I shall certainly support the amendment.

Mr. McLoughlin : In some ways, this has been one of the more interesting debates, if we look back at what was said in Committee. I was taken by what the hon. Member for Orkney and Shetland (Mr. Wallace) said tonight. It would probably have been better if the amendment had been moved by the hon. Member for Gordon (Mr. Bruce). In Committee, the hon. Member for Orkney and Shetland said : "The hon. Member for Thurrock (Mr. Janman) would reduce, through amendments Nos. 8 and 9, the threshold to £1 million. The hon. Member for Kingston upon Hull, East and his hon. Friends would increase it, through amendments Nos. 120 and 98, to £50 million."

Then he said :

"I may be adopting the classic Liberal position in opting for £10 million."--[ Official Report, Standing Committee D, 26February, 1991 ; c. 200.]

What has happened to that classic Liberal position ? The classic Liberal position just happened not to take account of Aberdeen. What the hon. Member for Orkney and Shetland probably did not know was that his hon. Friend the Member for Gordon had written to the Secretary of State to complain about the fact that Aberdeen would be included in the forced privatisation. The classic Liberal position was that one hand did not know what the other hand was doing.

Mr. Wallace : The Minister will know, if he reads a little further, that if he had accepted my amendments Nos. 105 and 199, Aberdeen would not have been affected anyway. He ignores the fact that my hon. Friend and I object, as a matter of principle, to the compulsory privatisation of Aberdeen or any threshold being inserted in the Bill. Has not the £10 million classic Liberal position been overtaken by rampant Tory inflation ?

Mr. McLoughlin : That was a nice try, but I still think that we smoked out where the classic Liberal position was in that case. A number of points have been made, but I cannot be held responsible for all the speculation that may appear in newspapers about what may be in future Conservative party manifestos. The fact that the press are more interested in Conservative party manifestos but share little interest in the Liberal party's manifesto may be because they know that we are more likely to be in a position to carry out our manifesto commitments.

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This is not the first attempt to raise the threshold to £5 million. In Committee, the hon. Member for Orkney and Shetland sought to take it up to £10 million, but that could have got him into trouble with the hon. Members for Aberdeen, North (Mr. Hughes) and for Aberdeen, South (Mr. Doran), as Aberdeen would still have been included in the original amendment. At least the figure of £10 million would have had the virtue of being a round figure, whereas £13 million has, despite the Opposition's arguments, nothing to commend it and no rationale. The hon. Member for Aberdeen North asked how we reached our decision of £5 million. As I said earlier today, and in Committee, that figure relates to the company's turnover and the likely prospects of its being successful in the private sector. The hon. Gentleman rightly pointed out that the Secretary of State, in consultation with various bodies, appoints all the members of that harbour authority. If we intended to privatise come what may, we would have another way to achieve our aims.

The clause requires companies to find out whether they would be better off in the private sector. We have accepted that there will be an affirmative resolution where we force a scheme to come forward.

Mr. Robert Hughes : As the hon. Member for Gordon (Mr. Bruce) said, we should not give the Minister ideas. However, it was always at the back of my mind that he would use the precedent that the Secretary of State for Transport used when he was Secretary of State for Scotland--he brought his cronies to the health board to do his dirty work. I would not put it past the Minister to do the same when it comes to appointing members of the harbour board.

Mr. McLoughlin : I have made it clear that the Government would like the larger trust ports to go into the private sector. When I visited Aberdeen, I was struck by the way in which the port operates and by the fact that it has characteristics that other trust ports throughout the country do not have. Trust ports are diverse.

Mr. Loyden : Is the Minister aware that the snapshot judgments that are being made purely on the question of ports' present financial positions would, two decades ago, have excluded Felixstowe from any development. How can the Government base their assessment of the future of the port transport industry on snapshot pictures taken at this stage, without having full regard to consequences that may occur in the future? I repeat that many successful ports in the United Kingdom, by the Government's criteria, would not exist today.

Mr. McLoughlin : Many successful ports are already in the private sector and have done well through being in it. Indeed, one of the reasons why Felixstowe did so well was that it was out of the constraints of the national dock labour scheme.

When we abolished the national dock labour scheme, Aberdeen was a great beneficiary. It was not opposed to it, and managed to secure much Government money via the abolition of that scheme.

The hon. Member for Orkney and Shetland has urged me to accept amendment No. 56. Ever since hon. Members have discovered that the Bill contained a turnover limit, they have been thinking of items to leave in the scheme and of others to remove from it. That comment applies especially to the hon. Member for Orkney and Shetland.

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In Committee, we heard about dredging, conservation charges and fishery operations. We have been told about cargo handling receipts this evening, and perhaps the hon. Gentleman's noble Friend in another place will suggest pilotage fees at a later date. That is another part of the operation that can be tried on. They may go on to argue that every aspect of turnover should be removed from the statement of turnover.

Despite the arguments that the hon. Member for Orkney and Shetland has advanced, I see no reason why cargo handling receipts and the other normal commercial activities of many ports should not be considered elements of turnover, if the ports carry out the work themselves. We are seeking a broad measure of port authorities' operations, and it does not make sense to seek to exclude the areas of activity to which I have referred. I ask the House to reject the amendment.

Ms. Walley : I put on record the Opposition's total resistance to the compulsion provisions in the clause. There is no substitute for removing the reserve powers. If the Minister understood that, we would not be considering amendments that represent an attempt to change the formula so that we have an exclusion zone based on a turnover of £13 million rather than one of £5 million. The compulsion provisions are wrong, and they should be removed.

When the hon. Member for Poole (Mr. Ward) was speaking to amendment No. 1 on Poole and the five years during which there would be no further consideration of privatisation, I attempted to intervene. As the hon. Member for Poole probably had an inkling that the Minister would take on board the terms of the amendment, I think that it would have been helpful if I had had the opportunity to express our real concerns about Poole and British Petroleum's proposals for Hook island, which show that at least five years are needed if a balanced view is to be reached of what is happening, and if the concerns of the fishermen and the environmentalists are to be properly taken on board. It must be understood clearly why such important changes are going ahead.

If the Bill did not contain the element of compulsion, we would not need to start playing about with figures. The Opposition have received many representations from the trust ports to the effect that it should be left to them, the ports, to decide whether to proceed. No playing around with figures can alter those representations. The £13 million formula would clearly be preferable if it were to take some of the trust ports out of the net of compulsory privatisation. The arguments on behalf of Aberdeen have been well advancd by my hon. Friend the Member for Aberdeen, North (Mr. Hughes). Anything that removes the compulsion provisions should be supported.

Mr. Wallace : The hon. Member for Stoke-on-Trent, North (Ms. Walley) is right : if the compulsory element were removed from the Bill, there would be no need to table amendments such as those that are before the House. Equally, there would be no need to try to devise criteria if the Government would only put before us some of their criteria. It was the opposition of my hon. Friend the Member for Gordon (Mr. Bruce) that prompted him to write to the Secretary of State to make out the case of Aberdeen, with which I entirely agree. There is no dispute between us. We are entirely opposed to the compulsion.

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There is a split, however, in the Tory ranks, between a Tory Secretary of State for Transport in 1988, who said that he would not force smaller ports down the road to privatisation, and a Tory Secretary of State for Transport in 1991 who is forcing the smaller ports down that road. That is a fundamental split in Government ranks. The Minister has not explained why the figures of the former Secretary of State for Transport, the right hon. Member for Southend, West (Mr. Channon) have not been accepted, so we shall divide on the issue.

Question put, That the amendment be made : --

The House divided : Ayes 95, Noes 176.

Division No. 122] [10.44 pm

AYES

Abbott, Ms Diane

Adams, Mrs Irene (Paisley, N.)

Barnes, Harry (Derbyshire NE)

Barnes, Mrs Rosie (Greenwich)

Battle, John

Beckett, Margaret

Bell, Stuart

Bellotti, David

Bennett, A. F. (D'nt'n & R'dish)

Benton, Joseph

Bermingham, Gerald

Blunkett, David

Bray, Dr Jeremy

Brown, Gordon (D'mline E)

Brown, Nicholas (Newcastle E)

Brown, Ron (Edinburgh Leith)

Caborn, Richard

Campbell, Menzies (Fife NE)

Campbell-Savours, D. N.

Clelland, David

Clwyd, Mrs Ann

Cohen, Harry

Cousins, Jim

Crowther, Stan

Cryer, Bob

Cunliffe, Lawrence

Dalyell, Tam

Dixon, Don

Doran, Frank

Dunnachie, Jimmy

Fearn, Ronald

Flynn, Paul

Foulkes, George

Fraser, John

Fyfe, Maria

Galloway, George

George, Bruce

Golding, Mrs Llin

Gordon, Mildred

Griffiths, Nigel (Edinburgh S)

Griffiths, Win (Bridgend)

Hain, Peter

Haynes, Frank

Henderson, Doug

Home Robertson, John

Hood, Jimmy

Howarth, George (Knowsley N)

Hughes, John (Coventry NE)

Hughes, Robert (Aberdeen N)

Hughes, Simon (Southwark)

Illsley, Eric

Kirkwood, Archy

Lamond, James

Leadbitter, Ted

Lewis, Terry

Livingstone, Ken

Livsey, Richard

Loyden, Eddie

McAvoy, Thomas

McKay, Allen (Barnsley West)

McLeish, Henry

McMaster, Gordon

Madden, Max

Mahon, Mrs Alice

Marek, Dr John

Marshall, David (Shettleston)

Martlew, Eric

Maxton, John

Michael, Alun

Michie, Mrs Ray (Arg'l & Bute)

Nellist, Dave

Oakes, Rt Hon Gordon

O'Hara, Edward

Pike, Peter L.

Powell, Ray (Ogmore)

Prescott, John

Primarolo, Dawn

Quin, Ms Joyce

Reid, Dr John

Robertson, George

Salmond, Alex

Short, Clare

Skinner, Dennis

Spearing, Nigel

Steel, Rt Hon Sir David

Steinberg, Gerry

Taylor, Matthew (Truro)

Turner, Dennis

Vaz, Keith

Wallace, James

Walley, Joan

Ward, John

Wardell, Gareth (Gower)

Williams, Alan W. (Carm'then)

Wise, Mrs Audrey

Tellers for the Ayes :

Mr. Malcolm Bruce and

Mr. Alex Carlile

NOES

Alexander, Richard

Alison, Rt Hon Michael

Amos, Alan

Arbuthnot, James

Arnold, Jacques (Gravesham)

Arnold, Sir Thomas

Ashby, David

Aspinwall, Jack

Baldry, Tony

Bellingham, Henry

Bennett, Nicholas (Pembroke)

Benyon, W.

Bevan, David Gilroy

Blackburn, Dr John G.

Blaker, Rt Hon Sir Peter

Body, Sir Richard

Bonsor, Sir Nicholas

Boscawen, Hon Robert

Bottomley, Peter

Bottomley, Mrs Virginia

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